Should I Opt For Invoice Financing?

Should I Opt For Invoice Financing?


There are many high-quality companies willing to help you if you are interested in invoice financing. This kind of financing can give you the cash boost you need to keep driving your business forward and avoid missing out on valuable investment opportunities. Two main forms of invoice financing are normally available; these are invoice discounting and invoice factoring. With invoice factoring, you essentially sell your invoice to the finance company, who then takes over the responsibility of chasing up payment themselves.

Discounting and Factoring

Invoice factoring could be right for you if you don’t mind your client knowing you’ve used a third party. It could also be your best option if you’ve been waiting too long to be paid or if you don’t think you’ll be selling services or products to the client again. Discounting may be preferable if you don’t want the client to know you’ve been working with a financier, the money isn’t late but you simply need it as soon as possible and if you have a good relationship with the company.

Always Ask Questions

You’ll usually get to keep around 85-90% of the value of the invoice, though you may need to pay slightly more for factoring as you’ll essentially be enjoying the services of an outsourced collections department. Invoice financing can give you all the valuable breathing space you need, and companies from a wide range of sectors have been taking advantage of it. You may wish to speak to four or five different companies before you come to a decision so you can make an informed choice. You’ll usually see the money you need reach your account within 24-48 hours. Feel free to ask as many questions as you need to before you agree to use a company’s service.

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